Mississippi LLC Formation: Everything You Need to Know
When it comes to Mississippi LLC formation, the first step is finding a name that attracts the right type of clientele.3 min read
2. Certificate of Formation
3. Operating Agreement
5. Business Bank Account
6. Tax Withholding
When it comes to Mississippi LLC formation, the first step is finding a name that attracts the right type of clientele. Keep in mind that your name must have words such as “Limited Liability Company” or abbreviations in the form of “LLC” or “L.L.C.”
The following words are restricted:
Additional paperwork is required for certain professions such as law or medicine. In addition, the following words are outright prohibited:
- Secret Service
You may not use any words that associate your LLC with government agencies.
Once you have a name in mind, search the state database to ensure that the name is not already taken by another business. You can conduct a search by going to the State of Mississippi website. You can also reserve your name at the Secretary of State by filling out a reservation name application and paying the $25 fee. If the name is not in use, you should also register your domain name, even if you do not intend to establish a website. Doing so prevents others from using your business name online.
Mississippi law requires you to appoint a registered agent for your business. The agent will be the person or entity that receives any official paperwork on behalf of your LLC. Such paperwork could include legal action paperwork or any official notification from state authorities. A registered agent must have the following qualities:
- Resident of Mississippi
- A Business that is Authorized to Conduct Business in the State
You can choose yourself as the registered agent or someone within the company. Keep in mind that the agent must have a physical street address in Mississippi.
To register your LLC, you need a Certificate of Formation. This is the document you’ll file with state officials, and it creates your LLC. You must register online to file this document. Your Certificate of Formation must include the following upon registration:
- LLC Name and Address
- Name and Address of Registered Agent
- LLC Duration (You May Input “Perpetual” or a Specified Period)
- Whether the Business is Member or Manager-Managed
It’s worth noting that LLC state filings should be completed via the online registration system, as of 2015. You create an account with a username and password, and you can complete a Certificate of Formation and pay online. Also, you may print it out and mail with a check. You will pay a filing fee of $50. Also, fees are subject to change, which is why should check with the Secretary of State for the most recent fee structure.
An operating agreement is not mandatory under state law, but you should create one to outline the basic operating structure of your business. In essence, it is the document that details the ownership and management structure of the business. Keep the operating agreement in plain view for all parties to see, and ensure that everyone understands the rules, rights and operating guidelines of your LLC.
The employer identification number (EIN) is used by the IRS to tax and label your LLC. In essence, it is the Social Security Number of your business, and it is needed to file federal and state taxes. Further, banks need an EIN when you open a business bank account. You may get an EIN free of charge by going to the IRS website.
Business Bank Account
One of the most important things you’ll do as part of the LLC process is establishing a business bank account. A separate business account divides your personal and business assets, which is vital when it comes to gaining LLC personal asset protections. In addition, a business account makes filing taxes and accounting methods easier. Also, you should also get a business credit card to build a business credit profile and to further divide your personal and business expenses.
If you have employees within your LLC, you must registered for the following:
- Employee Withholding Tax
- Unemployment Insurance Tax
You must register for Mississippi Unemployment Insurance Tax via the Mississippi Department of Employment Security, and Employee Withholding Tax via the Mississippi Department of Revenue. Registration is necessary for withholding taxes on behalf of your employees. If you are selling any taxable services or goods in Washington, you need to register under Mississippi Sales Tax via the Mississippi Department of Revenue.
To learn more about Mississippi LLC formation, submit your legal inquiry to the UpCounsel marketplace. UpCounsel’s top lawyers will help you create an LLC in Mississippi and navigate the ins and outs of tax withholding if you have employees. Moreover, our lawyers will help you draft a sound operating agreement if you are contending with multiple members.